What You Need to Know
Inflation remains persistently high, dominating everything else in the macro outlook. Until inflation is declining in a sustainable way, investors should not expect support from central banks. We expect market volatility to be with us for the next several months at least.
Key Forecast Trends
- Near-term, inflation will remain elevated. We anticipate at least another 100–150 b.p. of tightening from major central banks in the next few months.
- There are already signs of an economic slowdown globally, but household finances are robust, corporate balance sheets are strong, and the global financial system does not seem particularly vulnerable to asset price bubbles.
- We also expect the Chinese economy to rebound in 2023 after a poor performance in 2022— another reason to expect the coming downturn to be milder rather than more severe.
- In financial markets, higher interest rates, lower equity prices and wider credit spreads are, unfortunately, part of the solution to the inflation problem. Much of the work has already been done, but we think it is nonetheless premature to sound the all-clear.
Global Forecast
Past performance, historical and current analyses, and expectations do not guarantee future results. There can be no assurance that any investment objectives will be achieved. The information contained here reflects the views of AllianceBernstein L.P. or its affiliates and sources it believes are reliable as of the date of this publication. AllianceBernstein L.P. makes no representations or warranties concerning the accuracy of any data. There is no guarantee that any projection, forecast or opinion in this material will be realized. Past performance does not guarantee future results. The views expressed here may change at any time after the date of this publication. This document is for informational purposes only and does not constitute investment advice. AllianceBernstein L.P. does not provide tax, legal or accounting advice. It does not take an investor’s personal investment objectives or financial situation into account; investors should discuss their individual circumstances with appropriate professionals before making any decisions. This information should not be construed as sales or marketing material or an offer or solicitation for the purchase or sale of any financial instrument, product or service sponsored by AB or its affiliates.
The views expressed herein do not constitute research, investment advice, or trade recommendations and do not necessarily represent the views of all AB portfolio-management teams.
MSCI makes no express or implied warranties or representations, and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, reviewed or produced by MSCI.
© AllianceBernstein
Read more commentaries by AllianceBernstein
